While homeowner and landlord insurance policies are very similar in certain respects, insurance companies have a few notable requirements and coverage options that are distinctly different for each of them.
SO WHAT’S THE DIFFERENCE?
Homeowners insurance applies to either a primary residence or second home in which the property owner is the resident. Landlord insurance is intended to protect non-owner occupied properties where tenants reside.
Like homeowners insurance, a landlord insurance policy will cover the structure/building in case of fire, wind damage, lightning, etc. A closer look, though, reveals that the details of the coverage has two primary differences:
LIABILITY PROTECTION – Landlord liability insurance is intended to only cover accidents occurring at the rental property that may also involve employees, tenants, and visitors. Homeowners insurance, on the other hand, will not only cover the owner and any relatives living in the home, but also for accidents and other liabilities that occur away from the home. You sometimes hear about defamation lawsuits that try to collect from a defendant’s homeowners policy because liability limits are often hundreds of thousands of dollars.
PERSONAL PROPERTY – Homeowners policies are known to cover personal belongings such as clothing, furniture, and electronics. Landlord insurance on the other hand does not cover a tenant’s personal belongings, instead, it only covers items that are directly related to maintaining or servicing the rental property.